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Top Ideas are high-conviction long or short ideas focused on market mispricings with asymmetric risk/reward profiles.
  • Check Point Software Technologies: Calling Activists As Cash Balances Continue To Increase
     • Sat, Oct. 18 CHKP 2 Comments

    Summary

    • Check Point's balance sheet is bloated with cash, with net cash & investments amounting to almost a third of the company's market capitalization.
    • The company's operating margins and cash flow generation are higher than any of its competitors, including Microsoft.
    • Combination of steady, but uninspiring revenue and EPS growth and continued growth in cash balances has created an attractive entry point for activist investors.
    • Check Point has a long track record of share buybacks; since 2006 the company has bought back over 20% of its shares.
  • HealthEquity: A Niche Pure Play On Healthcare Reform
     • Sat, Oct. 4 HQY 14 Comments

    Summary

    • HealthEquity offers investors a unique and focused opportunity to profit from the ongoing implementation of the Affordable Care Act.
    • Solid market position and product offerings have led to double-digit revenue and profit growth.
    • Scalable business model has resulted in expanding EBITDA margins, with further increases to occur in the next several years.
    • Pullback from post-IPO highs offers an attractive entry point for long-term investors.
  • Arris Group: Finding Profits In Your Cable Box
       • Wed, Sep. 3 ARRS 10 Comments

    Summary

    • The acquisition of Motorola Home has been very successful, resulting in double-digit growth in operating income and EPS.
    • Post-earnings selloff on unfounded concerns surrounding bookings has created an attractive entry point.
    • Continued balance sheet deleveraging will lead to increased ability to return capital to shareholders.
    • Despite year-to-date gains, shares continue to trade at modest multiples, both on an absolute and relative basis.
  • DTS Inc.: A Mundane Business, With Exciting Profits
       • Fri, Aug. 22 DTSI 7 Comments

    Summary

    • Margin-rich royalty revenues result create business with material operating leverage.
    • Partnerships with majority of leading consumer electronics companies create tailwinds as network-connected electronics sales continue to grow.
    • Clean balance sheet with over $2 per share in net cash.
  • Flextronics: Solid Free Cash Flow Deployment And Cost Controls To Drive Further Upside
       • Thu, May. 15 FLEX 5 Comments

    Summary

    • At over 12%, Flextronics' free cash flow yield is the highest in its peer group.
    • Tight cost controls are set to underpin expanding operating profit and margins.
    • Flextronics has demonstrated a commitment to returning capital, having bought back almost 10% of the company in fiscal 2014 alone.
    • The company's upcoming May 21 analyst and investor day will likely feature further updates on capital allocation and cost controls, which may drive further upside.
    • Diversity of customer base may limit ability for short-term momentum rallies, but offers long-term stability.
  • American Airlines Group: As The Integration Continues, Solid Upside Ahead
       • Tue, Apr. 29 AAL 58 Comments

    Summary

    • Despite leading the domestic airline industry in forward EPS growth, American sports the industry's lowest P/E multiple.
    • Hundreds of millions of dollars in interest savings are set to flow through to the company's bottom line.
    • American now has a lower cost structure cost than either Delta or United, yet receives little credit for it.
    • Through Chapter 11, leverage has been reduced to industry-average levels.
    • Conservative synergy targets create room for possible increases to the company's forecasts.
  • Lifetime Brands: A Mundane Company, With Exciting Profit Potential
       • Wed, Apr. 16 LCUT 15 Comments

    Summary

    • Lifetime's mundane business belies its profit potential.
    • The company expanded gross margins during the key holiday quarter, alongside rising revenues and EPS.
    • With insiders owning 22% of outstanding shares, capital is being deployed in an accretive fashion.
    • Continued moves to enlarge brand portfolio and international presence will increase Lifetime's addressable market.
  • G-III Apparel Group: Unjustified Discount Belies Solid Execution And Opportunities Ahead
       • Tue, Apr. 8 GIII 4 Comments

    Summary

    • G-III managed to not only grow revenues, EPS, and EBITDA in the holiday quarter, but posted rising gross margins across all segments.
    • Despite solid performance in fiscal 2014, shares trade at meaningful discounts to peers.
    • With management owning over 16% of outstanding shares, clear incentive to deploy capital in an accretive fashion.
  • Nexstar Broadcasting Group: In 2014, Its Star Will Continue To Shine
       • Sat, Mar. 15 NXST 14 Comments

    Summary

    • Sizable pullback has created an attractive entry point in NXST.
    • Balance sheet is stronger than a cursory glance suggests.
    • Dividend increase in early 2014 suggests confidence in future cash flows.
  • Kate Spade & Company: The Crown Jewel Begins To Shine, For Investors And Bidders
       • Tue, Mar. 4 KATE 12 Comments
  • Sonus Networks: Connecting Shareholders To Double-Digit Returns In 2014
       • Tue, Feb. 25 SONS 10 Comments
  • Air Canada: Finding Value With Our Friends To The North
       • Wed, Feb. 19 AIDIF 8 Comments
  • SoftBank: For Exposure To Alibaba, Look To Tokyo, Not Sunnyvale
       • Sat, Feb. 15 SFTBY 31 Comments
  • RF Micro Devices: A Return To Growth Set To Reward Shareholders
       • Tue, Feb. 4 RFMD 12 Comments
  • Crédit Agricole: Farming Double-Digit Returns At France's Largest Bank
       • Dec. 31, 2013 CRARY 8 Comments
  • TIM Participações: As The Chess Pieces Move In Europe, Double-Digit Upside In Brazil
       • Dec. 27, 2013 TSU 12 Comments
  • Regions Financial: Double-Digit Upside As Southern Recovery Continues
       • Dec. 19, 2013 RF 4 Comments
  • Meaningful Upside Ahead As More And More Consumers Join The Devil In Wearing Prada
       • Dec. 14, 2013 PRDSY 3 Comments
  • Volaris: The Spirit Airlines Of Mexico Is Poised To Soar
       • Dec. 11, 2013 VLRS 25 Comments
  • Pacific Sunwear: Finding Sunshine Amidst Teen Retail Gloom
       • Dec. 10, 2013 PSUN 2 Comments
  • Tilly's: Reset Of Expectations, Favorable Valuation To Drive Recovery In 2014
       • Dec. 5, 2013 TLYS 2 Comments
  • Children's Place: Child-Sized Clothes, Adult-Sized Potential
       • Dec. 3, 2013 PLCE 1 Comment
  • Commtouch Software: A Return To Earnings Growth To Reward Investors
       • Nov. 26, 2013 CYRN 6 Comments
  • Spirit Airlines: A Solid Derivative Play On The US Airways-American Airlines Deal
       • Nov. 15, 2013 SAVE 11 Comments
  • Pericom Semiconductor: Recovering Business & Cash Deployment To Drive Upside
       • Nov. 12, 2013 PSEM 6 Comments
  • Commerzbank: Substantial Value In Germany's 2nd Bank
       • Nov. 2, 2013 CRZBY, CRZBF 25 Comments
  • Christian Dior: A Better Way To Invest In Louis Vuitton
       • Oct. 23, 2013 CHDRY 6 Comments
  • Burberry: CEO Transition Offers Attractive Entry Point Into Long-Term Luxury Growth
       • Oct. 18, 2013 BURBY 1 Comment
  • Lionsgate: Satiating Shareholders As The Hunger Games Approach
       • Oct. 1, 2013 LGF 7 Comments
  • The Royal Bank Of Scotland: Undervalued As Restructuring Moves Forward
       • Sep. 28, 2013 RBS 17 Comments
  • PDF Solutions: Profiting From Semiconductor Industry Growth
       • Sep. 24, 2013 PDFS 1 Comment
  • easyJet: An Easy Pathway To Shareholder Returns
       • Sep. 24, 2013 ESYJY 1 Comment